laurel-and-hardy-shh-150x150-5976094State regulators last week shot down efforts by utilities to show ratepayers the amount by which their electric bills are being driven up by New York’s new Clean Energy Standard.

Under the standard, adopted in August by the state Public Service Commission (PSC) at the urging of Governor Cuomo, utilities and anyone else buying power from the state’s electrical grid must help subsidize three money-losing nuclear power plants and new solar panels and wind turbines. The standard also absorbed the state’s existing renewable energy subsidy program.

The PSC then told utilities to show how they’d hike rates to recoup the costs of complying with the mandate, a necessary step since their rates are heavily controlled by the commission. In responses filed in December, utilities with service areas covering New York City and the entire Hudson Valley—Con Edison, Orange & Rockland Utilities, National Grid and Central Hudson Gas & Electric—each proposed adding one or two lines to customer bills, to better allow ratepayers to see where their money is going.

But last Wednesday, the PSC slammed the door on the idea, issuing a written ruling that “the Commission finds it preferable to recover the costs” of complying with the standard “through existing supply mechanisms and bill lines.” The PSC’s rationale, the commissioners wrote, was to “maintain general consistency among the Utilities” and to “limit customer confusion.”

Translation: don’t try to show this to customers as a separate line on their bill, or else we won’t okay your rate plans.

Under state law, utilities can only charge the rates and fees that the PSC allows under each company’s tariff—which this month must be amended to reflect the higher rates. And since they need the PSC to sign off on their tariffs, the utilities have little choice but to comply with the PSC’s efforts to hide the cost of the Clean Energy Standard—which is stacking up to be one of the largest tax hikes in state history.

That price tag will be about $360 million during 2017, with almost all the money going toward the nuclear subsidies that begin on April 1. The PSC had planned to require about $20 million in subsidies for new renewable generators but subsequently slashed the requirement after it became clear the state had grossly overestimated the actual number of qualifying wind turbines and solar panels. In 2018, the first full year of nuclear subsidies, the price will approach $500 million.

While the PSC instructed the utilities to post their costs and to show the “effective rates” in statements on their websites, there’s a big difference between that and letting them show customers exactly how much Cuomo’s energy plan is adding to their bills.

Isolating these costs would have tested Cuomo’s questionable claim that the mandate will add less than $2 per month to the average residential bill. It might even have opened the door to enumerating the cost of the governor’s broader “Reforming the Energy Vision” push to change the role utilities play in how power is generated and distributed. And it would have been a constant reminder that New Yorkers are paying more for electricity than they need to.

Tags:

About the Author

Ken Girardin

Ken Girardin is the Empire Center’s Policy Analyst, performing detailed analysis of data and public policy in support of the Center’s research work.

Read more by Ken Girardin

You may also like

Wind costs could blow up

The long-term cost of subsidies for New York’s new offshore wind turbine projects could exceed $6 billion—or three times the amount acknowledged by Governor Andrew Cuomo’s energy agency. Read More

Offshore wind to soak upstate

Upstate electricity customers could shell out more than $1 billion to cover the state’s initial round of subsidies for offshore wind turbines, the Cuomo administration’s energy agency has now revealed. Read More

Trucking NY’s natural gas gap

Yesterday’s fatal truck accident outside Binghamton is a reminder that state government’s opposition to natural gas pipelines is having negative consequences⁠—including putting more gas trucks on the road. Read More

Cuomo tilts with windmills

Governor Andrew Cuomo is continuing full steam ahead with policies that will make the state’s already lofty renewable energy targets more expensive and less realistic. Read More

How NY fuels higher emissions

In the name of reducing greenhouse gas emissions, the Cuomo administration has been doing everything it can to block construction of natural-gas pipelines in New York. But that policy is probably accomplishing just the reverse—increasing greenhouse gas emissions by boosting reliance on fuel oil, which results in even higher emissions. Read More

Albany unleashes a green monster

The Climate Leadership and Community Protection Act on its way to enactment in Albany would vastly expand the state government’s power to regulate every corner of New York’s economy in pursuit of reducing greenhouse gas emissions. Yet even as it addresses what proponents describe as a “climate emergency,” the bill’s most controversial elements have been postponed until after the 2022 elections. Read More

NY’s green new dud

New York got less electricity from renewable sources in 2018 than it did the year before despite significant state intervention. Read More

Wind costs will blow north

Upstate New York ratepayers will pick up more than half the multi-billion-dollar tab for a massive offshore wind turbine project that will provide very costly power for Long Island and New York City. Read More

Subscribe

Sign up to receive updates about Empire Center research, news and events in your email.

CONTACT INFORMATION

Empire Center for Public Policy
30 South Pearl St.
Suite 1210
Albany, NY 12207

Phone: 518-434-3100
Fax: 518-434-3130
E-Mail: info@empirecenter.org

About

The Empire Center is an independent, non-partisan, non-profit think tank located in Albany, New York. Our mission is to make New York a better place to live and work by promoting public policy reforms grounded in free-market principles, personal responsibility, and the ideals of effective and accountable government.